Pipeline spills impact Petroperú's bottom line

Peru's state oil company Petroperú saw net profits fall 15% in 2016 to 426mn soles (US$131mn), which the NOC attributed in part to the temporary closure of the Nor Peruano oil pipeline (ONP).

Energy and gas investment regulator Osinergmin ordered the suspension of ONP operations in February 2016 after a spill. Since then, the duct has suffered at least 10 ruptures, which Petroperu says are caused by third parties.

In its latest MD&A, the company highlighted reduced ONP service revenue of 119mn soles and 404mn soles in related spill contingency and environmental remediation costs.

During a hearing before a congressional committee investigating the spills, Petroperú chairman Luis García Rosell said the pipeline's overhaul could cost US$800mn. He added that ONP is in a test period.

The company plans to hire an international firm to carry out studies into a technological revamp of the oil transport infrastructure.

Local hydrocarbons consultant Víctor Saavedra told BNamericas previously that "not only is the [ONP] infrastructure underutilized, but there also has been no major maintenance in over 10 years. As a result, practically 60% of the length of the pipeline has points of corrosion with loss of thickness between 70-80%."

TALARA REFINERY

The financial document adds that physical completion of the Tarala refinery modernization project (PMRT) reached 52% at end-December.

García told lawmakers that PMRT works could be delayed by a year due to pending awards.

Pictured: An official from Peru's environmental monitoring agency OEFA takes soil samples following a recent ONP spill (CREDIT: OEFA).